Griffon Corporation (NYSE:GFF) Q2 2024 Earnings Conference Call May 8, 2024 8:30 AM ET

Company Participants

Brian Harris - Chief Financial Officer
Ron Kramer - Chairman & Chief Executive Officer

Conference Call Participants

Tim Wojs - Baird
Trey Grooms - Stephens
Bob Labick - CJS Securities
Sam Darkatsh - Raymond James
Julio Romero - Sidoti & Company
Justin Bergner - Gabelli Funds

Operator

Good day, and welcome to the Griffon Corporation Fiscal Second Quarter 2024 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Brian Harris, CFO. Please go ahead.

Brian Harris

Thank you, operator. Good morning. It's my pleasure to welcome everybody to Griffon Corporation's second quarter fiscal 2024 earnings call. Joining me for this morning's call is Ron Kramer, Griffon's Chairman and Chief Executive Officer. Our press release was issued earlier this morning and is available on our website at griffon.com. Today's call is being recorded and replay instructions are included in our earnings release.

Our comments will include forward-looking statements about the Griffon's performance. These statements are subject to risks and uncertainties that can change as the world changes. Please see the cautionary statements in today's press release and in our SEC filings.

Finally, some of today's remarks will adjusting for items that affect comparability between periods. These items are explained in our non-GAAP reconciliations included in our press release.

With that, I'll turn the call over to Ron.

Ron Kramer

Good morning, everyone and thank you for joining us. First half of fiscal 2024 is off to a great start and has exceeded our expectations. Second quarter was highlighted by continued solid operating performance from Home and Building Products and improved profitability at Consumer and Professional products. For the quarter, Home and Building Products revenue and EBITDA came in better than expected as the typical Q2 seasonal residential volume simply did not materialize. For our Consumer and Professional Products segment, second quarter revenue decreased 11% primarily due to decreased volume, driven by reduced customer demand in North America and the UK, partially offset by increased volume in Australia.

EBITDA improved 2% to $20 million in the quarter with the EBITDA margin improving year-over-year, primarily as a result of decreased North American production costs. I'm very pleased to tell you that our previously announced initiative to expand CPP's Global Sourcing strategy remains on schedule and within budget. We continue to expect the initiative to be complete by the end of calendar 2024. Since May, 2023, when we announced the initiative, we have ceased operations at all four affected US manufacturing facilities and four wood mills. These actions have reduced our manufacturing footprint by over 1.2 million square feet. As we've emphasized before, the global sourcing expansion at AMES is a key element of our strategy to improve the margins of CPP.